EXHIBIT 12
VEDDER, PRICE, KAUFMAN & KAMMHOLZ
222 North LaSalle Street
Chicago, Illinois 60601-1003
312/609-7500
VEDDER, PRICE, KAUFMAN, KAMMHOLZ & DAY VEDDER, PRICE, KAUFMAN & KAMMHOLZ VEDDER, PRICE, KAUFMAN, KAMMHOLZ & DAY
805 Third Avenue 4615 East State Street, Suite 201 2121 K Street, N.W.
New York, New York 10022-2203 Rockford, Illinois 61108-2100 Washington, D.C. 20037
212/407-7700 815/226-7700 202/496-1200
August 22, 1995
Nuveen New York Municipal Nuveen New York Municipal
Value Fund, Inc. Income Fund, Inc.
333 West Wacker Drive 333 West Wacker Drive
Chicago, Illinois 60606 Chicago, Illinois 60606
Gentlemen:
You have requested our opinion regarding certain federal income tax
consequences of the proposed reorganization ("Reorganization") of Nuveen New
York Municipal Income Fund, Inc., a Minnesota corporation ("Acquired Fund"),
into Nuveen New York Municipal Value Fund, Inc., a Minnesota corporation
("Acquiring Fund"). The Reorganization contemplates the acquisition by the
Acquiring Fund of substantially all the assets of the Acquired Fund in exchange
for voting shares of the Acquiring Fund and the assumption of the Acquired
Fund's liabilities. Thereafter, the shares of the Acquiring Fund will be
distributed to the shareholders of the Acquired Fund and the Acquired Fund will
be completely liquidated and terminated. The foregoing will be accomplished
pursuant to an Agreement and Plan of Reorganization and Liquidation, dated as of
August 1, 1995 (the "Plan"), entered into by the Acquired Fund and the Acquiring
Fund.
In rendering this opinion, we have reviewed and relied upon statements made
to us by certain of your officers. We have also examined certificates of such
officers and such other agreements, documents, and corporate records that have
been made available to us and such other matters as we have deemed relevant for
purposes of this opinion. In such examination, we have assumed the genuineness
of all signatures, the authenticity of all documents submitted to us as
originals, the conformity to originals of all documents submitted to us as
copies and the authenticity of the originals of such latter documents.
Our opinion is based, in part, on the assumption that the proposed
Reorganization described herein will occur in accordance with the agreements and
the facts and representations set forth or referred to in this opinion letter,
and that such facts and representations are accurate as of the date hereof and
will be accurate on the effective date of such Reorganization (the "Effective
Time"). We have undertaken no independent investigation of the accuracy of the
facts and representations set forth or referred to herein.
Nuveen New York Municipal Value Fund, Inc.
Nuveen New York Municipal Income Fund, Inc.
August 22, 1995
Page 2
For the purposes indicated above, and based upon the facts, assumptions and
conditions as set forth below, and the representations made to us by duly
authorized officers of the Acquired Fund and the Acquiring Fund in a letter
dated August 22, 1995, it is our opinion that:
i. The acquisition by the Acquiring Fund of substantially all the
assets of the Acquired Fund in exchange solely for Acquiring Fund shares
and the assumption by the Acquiring Fund of the Acquired Fund's
liabilities, if any, followed by the distribution by the Acquired Fund of
the Acquiring Fund shares to the shareholders of the Acquired Fund in
exchange for their Acquired Fund shares in complete liquidation of the
Acquired Fund, will constitute a "reorganization" within the meaning of
Section 368(a)(1)(C) of the Internal Revenue Code of 1986, as amended (the
"Code"), and the Acquiring Fund and the Acquired Fund each will be "a party
to a reorganization" within the meaning of Section 368(b) of the Code;
ii. The Acquired Fund's shareholders will recognize no gain or loss
upon the exchange of all of their Acquired Fund shares for Acquiring Fund
shares in complete liquidation of the Acquired Fund, except with respect to
cash received for a fractional Acquiring Fund share, if any (Code Section
354(a)(1));
iii. No gain or loss will be recognized by the Acquired Fund upon the
transfer of substantially all its assets to the Acquiring Fund in exchange
solely for Acquiring Fund shares and the assumption by the Acquiring Fund
of the Acquired Fund's liabilities, if any, and with respect to the
subsequent distribution of those Acquiring Fund shares to the Acquired Fund
shareholders in complete liquidation of the Acquired Fund (Code Section
361);
iv. No gain or loss will be recognized by the Acquiring Fund upon the
acquisition of substantially all the Acquired Fund's assets in exchange
solely for Acquiring Fund shares and the assumption of the Acquired Fund's
liabilities, if any (Code Section 1032(a));
v. The basis of the assets acquired by the Acquiring Fund will be, in
each instance, the same as the basis of those assets when held by the
Acquired Fund immediately before the transfer, and the holding period of
such assets acquired by the Acquiring Fund will include the holding period
thereof when held by the Acquired Fund (Code Sections 362(b) and 1223(2));
vi. The basis of the Acquiring Fund shares to be received by the
Acquired Fund's shareholders upon liquidation of the Acquired Fund will be,
in each instance, the same as the basis of the Acquired Fund shares
surrendered in exchange therefor,
Nuveen New York Municipal Value Fund, Inc.
Nuveen New York Municipal Income Fund, Inc.
August 22, 1995
Page 3
decreased by any cash received and increased by the amount of gain
recognized on the exchange (Code Section 358(a)(1)); and
vii. The holding period of the Acquiring Fund shares to be received
by the Acquired Fund's shareholders will include the period during which
the Acquired Fund shares to be surrendered in exchange therefor were held,
provided such Acquired Fund shares were held as capital assets by those
shareholders on the date of the exchange (Code Section 1223(1)).
FACTS
-----
Our opinion is based upon the above referenced representations and the
following facts and assumptions, any alteration of which could adversely affect
our conclusions.
The Acquired Fund has been registered and operated since it commenced
operations as a diversified, closed-end, management investment company under the
Investment Company Act of 1940, 15 U.S.C. (S)80a, et seq. (the "1940 Act"). Its
shares are traded on the New York Stock Exchange. The Acquired Fund has
qualified and will qualify as a regulated investment company under Section 851
of the Code for each of its taxable years, and has distributed and will
distribute all or substantially all its income so that it and its shareholders
have been and will be taxed in accordance with Section 852 of the Code.
The Acquiring Fund has also been registered and operated since it commenced
operations as a diversified, closed-end, management investment company under the
1940 Act. It has qualified as a regulated investment company under Section 851
of the Code for each of its taxable years, will so qualify for its current
taxable year, and has distributed and will distribute all or substantially all
its income so that it and its shareholders have been and will be taxed in
accordance with Section 852 of the Code. The Acquiring Fund's shares are traded
on the New York Stock Exchange.
Upon satisfaction of certain terms and conditions set forth in the Plan on
or before the closing date, the following will occur: (a) the Acquiring Fund
will acquire substantially all the assets of the Acquired Fund in exchange for
the Acquiring Fund's assumption of substantially all the liabilities of the
Acquired Fund and the issuance of Acquiring Fund shares to such Acquired Fund;
(b) the Acquiring Fund shares will be distributed to the shareholders of the
Acquired Fund; and (c) the Acquired Fund will be dissolved and liquidated. The
assets of the Acquired Fund to be acquired by the Acquiring Fund consist
primarily of bonds whose interest is exempt from federal income taxation, cash
and other securities held in the Acquired Fund's portfolio.
Nuveen New York Municipal Value Fund, Inc.
Nuveen New York Municipal Income Fund, Inc.
August 22, 1995
Page 4
The value of the Acquired Fund's assets to be acquired and the liabilities
to be assumed by the Acquiring Fund and the net asset value per Acquiring Fund
share to be issued by the Acquiring Fund will be determined by United States
Trust Company of New York ("U.S. Trust"), the custodian for each of the funds,
as of the Effective Time. Net asset value per Acquiring Fund share shall be
computed by dividing the value of the Acquiring Fund's total assets less
liabilities by the number of Acquiring Fund shares outstanding. In determining
net asset value per Acquiring Fund share and the value of the Acquired Fund's
assets, U.S. Trust will utilize the valuations of portfolio securities furnished
by a pricing service approved by the Boards of the respective funds.
As soon as practicable after the Effective Time, the Acquired Fund will be
liquidated and will distribute the newly issued Acquiring Fund shares it
receives pro rata to its shareholders of record in exchange for such
shareholders' interests in such Acquired Fund. Such liquidation and
distribution will be accomplished by opening accounts on the books of the
Acquiring Fund in the names of the shareholders of the Acquired Fund and
transferring to those shareholder accounts the Acquiring Fund shares. Each
shareholder account would represent the respective pro rata number of newly
issued Acquiring Fund shares (rounded down, in the case of fractional Acquiring
Fund shares, to the next largest number of whole Acquiring Fund shares) due such
Acquired Fund shareholder. No fractional Acquiring Fund shares will be issued.
In lieu thereof, pursuant to the Plan, the Acquired Fund's transfer agent will
aggregate all fractional Acquiring Fund shares and sell the resulting whole
Acquiring Fund shares on the New York Stock Exchange for the account of all
shareholders of fractional interests, and each such shareholder will be entitled
to his or her pro rata share of the proceeds of such sale upon surrender of his
or her Acquired Fund share certificates.
As a result of the Reorganization, every shareholder of the Acquired Fund
will own Acquiring Fund shares that, except for cash payments received in lieu
of fractional Acquiring Fund shares, would have an aggregate per share net asset
value immediately after the Effective Time equal to the aggregate per share net
asset value of that shareholder's Acquired Fund shares immediately prior to the
Effective Time. Since the Acquiring Fund shares issued to the shareholders of
the Acquired Fund would be issued at net asset value in exchange for the net
assets of such Acquired Fund having a value equal to the aggregate per share net
asset value of those Acquiring Fund shares so issued, the net asset value of the
Acquiring Fund shares should remain virtually unchanged by the Reorganization.
In approving the Reorganization, the Boards of Directors of the Acquiring
Fund and the Acquired Fund each identified certain benefits that are likely to
result from combining the funds, including lower administrative expenses,
greater efficiency and flexibility in portfolio management and a more liquid
trading market for the shares of the combined fund. Each Board also considered
the possible risks and costs of combining the funds and determined that the
Nuveen New York Municipal Value Fund, Inc.
Nuveen New York Municipal Income Fund, Inc.
August 22, 1995
Page 5
Reorganization is likely to provide benefits to the shareholders of each fund
that outweigh the costs incurred.
CONCLUSION
----------
Based on the foregoing, it is our opinion that the acquisition by the
Acquiring Fund, pursuant to the Plan, of substantially all the assets and
liabilities of the Acquired Fund in exchange for voting shares of the Acquiring
Fund will qualify as a reorganization under Code Section 368(a)(1)(C).
Our opinions set forth above with respect to (1) the nonrecognition of gain
or loss to the Acquired Fund and the Acquiring Fund, (2) the basis and holding
period of the assets received by the Acquiring Fund, (3) the nonrecognition of
gain or loss to the Acquired Fund's shareholders upon the receipt of the
Acquiring Fund shares, and (4) the basis and holding period of the Acquiring
Fund shares received by the Acquired Fund's shareholders, follow as a matter of
law from the opinion that the acquisition under the Plan will qualify as a
reorganization under Code Section 368(a)(1)(C).
The opinions expressed in this letter are based on the Code, the Income Tax
Regulations promulgated by the Treasury Department thereunder and judicial
authority reported as of the date hereof. We have also considered the position
of the Internal Revenue Service (the "Service") reflected in published and
private rulings. Although we are not aware of any pending changes to these
authorities that would alter our opinions, there can be no assurances that
future legislative or administrative changes, court decisions or Service
interpretations will not significantly modify the statements or opinions
expressed herein.
Our opinions are limited to those federal income tax issues specifically
considered herein and are addressed to and are only for the benefit of the
Acquired Fund and Acquiring Fund. We do not express any opinion as to any other
federal income tax issues, or any state or local law issues, arising from the
transactions contemplated by the Plan. Although the discussion herein is based
upon our best interpretation of existing sources of law and expresses what we
believe a court would properly conclude if presented with these issues, no
assurance can be given that such interpretations would be followed if they were
to become the subject of judicial or administrative proceedings.
We hereby consent to the filing of this opinion as an Exhibit to the
Registration Statement and to the use of our name under the captions "Proposal
No. 1 - The Reorganization - Tax Consequences of the Reorganization", "Legal
Opinions" and "Additional Information About the Funds - Tax Matters Associated
with Investment in the Funds" in the Joint Proxy Statement -Prospectus contained
in such Registration Statement. In giving such consent, we do not thereby
Nuveen New York Municipal Value Fund, Inc.
Nuveen New York Municipal Income Fund, Inc.
August 22, 1995
Page 6
concede that we are within the category of persons whose consent is required
under Section 7 of the Securities Act of 1933, as amended, or the rules and
regulations of the Securities and Exchange Commission thereunder.
Very truly yours,
/S/ VEDDER, PRICE, KAUFMAN & KAMMHOLZ
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VEDDER, PRICE, KAUFMAN & KAMMHOLZ